CMS's “Significant Expansion” of Audits Has Made UnitedHealth’s Bad Year Even Worse

New federal crackdown could expose billions in overpayments to Medicare Advantage plans.

The insurance conglomerates that dominate America’s privatized Medicare Advantage plans, including UnitedHealth Group, the $400 billion colossus that is still reeling from a series of setbacks, just received fresh bad news — this time, straight from the federal government.

As reported by MarketWatch, the Centers for Medicare and Medicaid Services (CMS) has launched a “significant expansion” of its audit program — one that will triple-check every Medicare Advantage (MA) plan in operation, including all of UnitedHealth’s. Nearly 2,000 employees are being hired to do the work, up from just 40 auditors before.

It doesn't seem like this move by CMS is just a bureaucratic reshuffling. It’s a direct response to longstanding concerns — largely raised by patient and consumer advocates — that private MA insurers have been massively overbilling taxpayers. Government reports estimate that MA plans may be overpaid by as much as $43 billion a year, with outside reports tallying even higher overpayments.

UnitedHealth has put on a brave face, saying it welcomes annual audits, but the timing speaks for itself. The company is already under a criminal investigation, has suspended its financial forecast, and is grappling with investor backlash. The stock is down nearly 50% since mid-April, and the headlines are stacking up faster than the lawsuits.

In all my years working inside corporate boardrooms and war rooms, I can tell you: what we’re seeing is not business as usual. The government's audit expansion, especially under an administration that many assumed would go soft on MA plans, suggests a real reckoning could be on the horizon.

It’s a long-overdue response to years of profiteering at the expense of seniors and taxpayers. And for UnitedHealth, the gut punches are far from over.